U.S. sues owners of landfill near Carroll County community Transfer of assets alleged to avoid cleanup costs

September 03, 1997|By Donna R. Engle | Donna R. Engle,SUN STAFF

The owners of Keystone landfill -- 300 yards across the Pennsylvania border from Silver Run in Carroll County -- have been fraudulently transferring assets to avoid paying for cleanup of the Superfund site, according to a lawsuit filed by the U.S. Justice Department.

Federal authorities filed suit Aug. 25 in U.S. District Court in Harrisburg, Pa., in an effort to ensure that landfill owners Kenneth F. and Anna Noel and Keystone Sanitation Co. Inc., will retain assets to help pay for the landfill cleanup. The closed private landfill was placed on the Environmental Protection Agency's Superfund cleanup list in 1987.

Silver Run-area residents, worried about possible contamination of their water, have sought a cleanup of the site for 14 years. They remain involved, despite an EPA-contracted study released April that ruled out the landfill as the source of pollutants in northern Carroll County wells.

The Noels and Keystone Sanitation could be liable for $11.9 million, according to the lawsuit. But U.S. District Judge Sylvia H. Rambo, in a 1995 ruling that froze some assets, said it was unlikely that the owners would have to pay more than half the total because of the large number of defendants in lawsuits who are accused of dumping toxic materials at the landfill.

Last week's court action is a follow-up to the 1995 ruling, a routine action in Superfund cases, Justice Department spokesman Bill Brooks said. The lawsuit preserves the government's claims against the owners under the Federal Debt Collection Act, he said.

"After the Noels learned the magnitude of their potential joint and several liability as responsible parties for total cleanup costs at the site, the Noels embarked on a series of transactions which stripped valuable assets from Keystone Sanitation Co.," the Justice Department alleged.

According to court documents, the Noels sold Keystone Sanitation to Waste Management of Pennsylvania for $3.1 million in Waste Management stock, then sold 30,000 shares of the stock for $1.1 million and lent the money to Flatbush Golf Course in Littlestown, Pa., which the couple owned. The couple then gave the golf course to their four children through individual trusts.